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Companies

MUFG avoids massive loss on Indonesian banking unit

Bank Danamon shares recover to safe level as quarter ends

Mitsubishi UFJ Financial Group risked facing its first April-June loss since the group's 2005 formation had it needed to write down goodwill on the Bank Danamon acquisition.   © Reuters

TOKYO -- Mitsubishi UFJ Financial Group no longer is expected to book a multibillion-dollar impairment charge this quarter on its stake in an Indonesian banking subsidiary, thanks to the lender's shares rebounding this month.

The Japanese financial group faced having to write down goodwill from its April acquisition of Bank Danamon by as much as 300 billion yen ($2.78 billion) after the midtier Indonesian lender's Jakarta-listed stock plunged in May.

But Danamon shares closed at 4,800 rupiah on Friday, the last trading day of the quarter -- above the 4,700 rupiah level needed to avoid the goodwill impairment.

A write-down might have left MUFG facing its first April-June loss since the group's formation in 2005.

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